5 Reasons Why Effective Leadership Will Boost Your Bottom Line (Plus, 5 Leadership Development Tips!)
🕐 Read Time 6 Minutes
We've all probably encountered a terrible leader at some point, and it's not hard to remember exactly why they left such a negative impression on us.
These are the leaders we've known to micromanage to the point of obsession, lack even an ounce of empathy, and even abuse their authority to intimidate. There are countless examples of "leaders" who repeatedly miss the mark, wasting their opportunity to build others up by instead tearing them down.
Then some leaders fall into what we might consider the "average" bucket. Perhaps they fulfill their responsibilities and check all the boxes but don't possess leadership development goals or the qualities that set them apart as a truly inspirational or impactful leader. It doesn't necessarily make them bad leaders, but they may simply lack that special "it" factor found in exceptional leaders (and that's okay!).
On the other hand, exceptional leaders are like a rare gem that is difficult to come by. Their distinctive combination of qualities and skills enables them to profoundly impact their teams and organizations, leaving them in a better state than before. When we are asked about those who have positively influenced our lives, the names and faces of these leaders dance to the forefront of our thoughts.
It's precisely these leaders that we all aspire to work or collaborate with. Employees are no longer solely after competitive salaries, lavish perks, and prestigious job titles. In fact, many willingly leave their current roles without a second thought in pursuit of a role where they prioritize leadership development in their companies.
For this reason, investing in your growth as a leader should be a top priority. Your commitment to personal development can have a far greater impact on your bottom line than any perk can.
5 Reasons Why Effective Leadership Will Boost Your Bottom Line
Let's explore in detail why leadership development is important and how effective leadership can directly impact your company's financial performance:
Talent attraction and retention
Increased employee productivity and creativity
Better team collaboration
Improved customer or client relationships
Enhanced brand reputation
Paying attention to these five areas will help your small business thrive and grow.
1. Talent Attraction and Retention
In today's highly competitive market, employers face the challenge of finding candidates who meet their requirements and align well with the company's culture. An even greater obstacle lies in retaining these valuable employees. Gone are the days when unhappy employees stay in a position for the sake of a polished resume showing a long-term commitment to one job.
A strong leadership reputation can be a powerful recruitment tool to attract top performers eager to work under visionary leaders. Then, when they see effective leadership in action, they are more likely to remain loyal and committed, reducing turnover and the associated costs of hiring and training new employees.
Leadership Development Tip: Create a culture where employees feel valued, respected, and a sense of belonging. Prioritize employee development and provide growth opportunities to give your team a long-term perspective of their role within the company.
2. Increased Employee Productivity and Creativity
We've all experienced those jobs or responsibilities where we go through the motions, eagerly waiting for the moment we can break free. While some people willingly subject themselves to jobs or responsibilities they're miserable doing for the sake of a higher paycheck, more often than not, it's the work environment and company culture that contribute to a domino effect of decreased productivity levels.
Exceptional leaders inspire and motivate their teams, fostering a culture of high employee engagement. Engaged employees are generally more committed, productive, and often willing to go the extra mile to help achieve organizational goals. As a result, this improves efficiency and drives revenue growth.
Leadership Development Tip: Lead by example and model the work ethic you expect from your employees. As they follow suit, acknowledge and appreciate their accomplishments, milestones, and hard work.
3. Better Team Collaboration
In tandem with the last point, unhappy employees not only withdraw from being truly present and productive but may also withdraw from interactions, avoid teamwork, and struggle to communicate with their colleagues. Even if you organize events like a monthly team lunch or other social gatherings, disengaged employees may show little to no interest in participating.
Neglecting or downplaying the importance of collaboration and its ability to drive innovation and revenue growth poses a risk to any business. Collaboration nurtures a sense of collective ownership and accountability while bringing together diverse perspectives, skills, ideas, and strengths to form a unified and high-performing unit. Moreover, it cultivates stronger relationships and promotes healthy conflict resolution.
By cultivating a culture of collaboration, leaders can unlock the collective potential of their teams and drive organizational success.
Leadership Development Tip: Provide a forum for your team to share updates, seek feedback, and collaborate on problem-solving.
4. Improved Customer or Client Relationships
It's commonly believed that the customer or client relationship should always be the top priority in business. However, could it be that the relationship between a leader and their team is equally, if not more, meaningful? After all, many leaders heavily rely on their teams to attract, serve, and retain customers or clients. How leaders invest in their team's development and well-being influences the level of service they provide.
The lack of enthusiasm in one's work is evident, and, unsurprisingly, uninvested and disengaged employees can harm customer or client relationships and, ultimately – your bottom line. When employees are poured into and supported, it empowers them to replicate the same level of exceptional care and service when engaging with customers or clients.
Leadership Development Tip: From the initial stages of interviewing and onboarding to their first interactions with clients (and beyond!), treat employees with the same level of care and respect that you expect them to demonstrate to customers or clients.
5. Enhanced Reputation and Brand Value
Building on the last point (are you noticing the pattern that all these elements are intertwined?) on caring for employees personally, an effective leader doesn't forget the importance of building them up professionally. After all, employees play an integral part in maintaining the smooth operation of a business by fulfilling essential responsibilities that contribute to its success.
A great leader creates an environment where employees can make decisions and problem-solve and provides the necessary resources and support to navigate those challenges effectively. They prioritize giving training, mentorship, and other developmental opportunities to equip their team to deliver exceptional service and performance.
The result? Happy customers or clients + a reputation that shines + word-of-mouth referrals = growing and scaling potential.
Leadership Development Tip: Empower your team by providing them with the necessary resources, training, and authority to make decisions as they serve customers or clients.
Leadership Development: A Necessity, Not an Option
There’s no denying the profound impact leadership has on an entire organization. It holds the power to shape company culture and ultimately influence employee satisfaction, behavior, and performance. It serves as the driving force behind nearly everything within an organization, determining whether it soars to new heights or stays grounded.
Isn’t it empowering to know that you hold the power to shape the trajectory of your bottom line through your actions as a leader? How will you leverage your position? Will you be a driving force for positive change or inadvertently impede it?
Delegate to Elevate: Outsourcing Financial Matters to Focus on What’s Important
At Financial Fitness Coaching, we recognize the myriad responsibilities that come with being a leader. From strategic planning and operations to marketing and managing relationships, you’re juggling an overwhelming amount of tasks. If your business finances are one of the areas that feel intimidating or overwhelming, you don’t have to do it alone.
As a financial coach for small business owners, we help people like you feel confident and in control of your business finances, freeing up your time to focus on what matters most – being an engaged and effective leader – to boost your bottom line.
To see how we can help, email us at info@financialfitnesscoaching.com or simply schedule a free 20-minute Discovery Call on our calendar.